Years ago, I bought a piece of land to build a house for my own living with my family. However, after sometime, I sold it because I decided to build a house somewhere else. I bought a new piece of land after I sold the first. Is the amount for which I sold the land liable for Zakah and how much is it?
Answer:
All perfect praise be to Allah the Lord of the Worlds. May His peace and blessings be upon our Prophet Mohammad and upon all his family and companions.
No Zakah is payable on the price of the land bought for building a house on because the land wasn`t bought to be sold for a profit. As for the new land, if you bought it to sell it for profit then you must pay the Zakah of its price after one year from the day you received its price.
In addition, if you have other wealth that reached Nisab (Minimum amount liable for Zakah) before that date, its Zakah is payable after a full lunar year passes over its possession, even if it is part of the price of the land you have bought for trade. Nonetheless, if you haven`t bought that land for sale then no Zakah is payable on it. And Allah the Almighty knows best.